Rapala Strengthens Strategic Alliance With Shimano

 

It has been announced to the Stock Exchange that Rapala and Shimano are to merge within the UK with a 50/50 deal with reagrds to distribution. To read the full Press Release to the Stock Exchange regarding the merger, please read below:

 

"Rapala VMC Corporation
Stock Exchange Release
June 16, 2011 at 4.30 pm 

Distribution 50/50 Joint Venture for UK 

Rapala VMC Corporation ("Rapala") and Shimano Inc. ("Shimano"), the leading manufacturer of rods and reels worldwide, have signed an agreement to strengthen their European distribution alliance by merging their existing UK distribution activities into a true 50/50 joint venture distribution company. This joint venture company, Shimano Normark UK Ltd ("JV"), currently Shimano UK Ltd, will enter into a distribution agreement with Rapala and its subsidiary Dynamite Baits Ltd regarding Rapala's current product offering in the UK. Shimano UK and Dynamite Baits UK distribution activities will be merged. Dynamite branded bait manufacturing activities will remain fully in Rapala's control under Dynamite Baits Ltd. JV will distribute in the UK Shimano reels and rods, G.Loomis rods, Power Pro fishing line and other Shimano fishing tackle products and Rapala, Dynamite Baits, Sufix, Storm and other Rapala fishing tackle products on an exclusive basis. 

"This is a historic and very important new step in the development of our distribution alliance, which will be a win-win concept for both parties and create a strong fishing tackle distributor in UK outperforming competition", says Jorma Kasslin, CEO of Rapala. "We are happy to extend our distribution alliance and to join forces with Rapala in UK, which is one of the largest market area in fishing tackle in Europe", say Marc van Rooy, Managing Director of Shimano Europe Holding B.V. and Pierangelo Zanetta, Managing Director of Shimano Europe Fishing Holding B.V. 

This transaction, subject to the board approval of Shimano Inc and Rapala VMC Oyj is expected to be completed and closed by end of August, 2011. It will have a minor effect on 2011 net sales but it is expected to improve Rapala's profitability in 2012. 

Already before this transaction, Rapala distributes Shimano rods and reels, G.Loomis rods, Power Pro fishing lines and other Shimano branded products in South Africa and 27 countries in Europe. Shimano distributes Rapala branded products in 4 countries in Europe. Rapala and Shimano are already having 50/50 Joint Venture distribution companies in Russia, Ukraine and Czech Republic and Slovak Republic and Shimano owns 33 % minority shareholding in Rapala's distribution companies in Hungary and Romania.

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Any further developments with regards to this merger will be reported on as soon as possible.